A working paper by the Midwest Climate Collaborative
© Heather Navarro and Anukriti Lirio Hittle
Sept. 9, 2024, Updated Nov. 15, 2024
Executive Summary
While the funds made available through the inflation Reduction Act (IRA) and the Bipartisan Infrastructure Law (BIL) represent the greatest investment in climate our country has ever seen, not only is much more needed to solve the climate crisis, but a change in the way these funds are being disbursed is necessary in order to reach the intended recipients.
We discuss the Climate Pollution Reduction Grants (CPRG), first of the Environmental Protection Agency’s one-time grant opportunities of notable magnitude. The CPRG opened doors to federal funding that is not limited to only states, and brought in cities and municipalities in climate-hesitant states.
Based on our engagement in the region, we estimate that the equivalent of several full-time employees’ (FTEs) worth of time over a year was spent on applying for the CPRG implementation grants, which translates to several hundreds of thousands of dollars of state and local funds. However, the current grants process disproportionately burdens these communities that are doubly penalized when they do not receive the funding, especially after having spent a substantial amount of time and resources on applying. To lower the barriers to entry, the grantmaking process needs to incorporate some changes.
We propose and discuss recommendations for federal grantmaking agencies. Federal agencies could use formula and block grants rather than competitive grants; they could use a formula or ranking system for municipalities and non-state entities, use a flat rate system for all, use existing grant making organizations, and expand existing programs that address the basics.
On the recipient side, we discuss several ways to mitigate the unpredictability of a one-time flow of federal funds, such as: instituting grant development as a basic organizational function, constructing an “accordion” structure for federal funds, utilizing direct/elective pay to fund projects, and using the funding gap and grants infrastructure to leverage private investment.
These recommendations are put forward to make federal grants more effective for its recipients, particularly for the smaller communities who put in a disproportionate amount of effort in applying for them. The document outlines the need for charting a grants map, for navigating federal and other funds, and building pathways to procuring funds for climate priorities.